Observations on economics, the academy, the wider world, and things that run on rails.

10.5.16

WHEN THE NARRATIVE IS INCONVENIENT.

The absence of a federal standard for inspecting carnival rides is newsworthy. The unintended consequences of the federal standard called the Patient Protection and Affordable Care Act (two lies for the price of one), however, don't square with Four of Five Experts Agree It's For Your Own Good, and thus an entire segment on surprise medical bills never mentions the turmoil on the exchanges or the death spiral of private insurance companies.

Insurers raising prices as a result of lower than anticipated enrollment is an early step toward an insurance death spiral, in which premiums spike and enrollment figures drop until the only participants who remain in the market are very people paying very high premiums. We know because we’ve seen it before—in New York, Washington, and handful of other states that enacted preexisting condition regulations similar to Obamacare’s but without an individual mandate.

Yes, and Lester Holt, your story comes as no surprise.

The larger worry is that we may be on track for an insurance market meltdown no matter what happens with the individual mandate. If too few young and healthy people sign up for insurance through the exchanges, for whatever reason, insurers will have to adjust their prices eventually. The access problems in the exchanges exacerbate this risk by making it more frustrating to buy policies; as a result, only the most motivated people—which is to say, the sickest and most desirous of coverage—will end up buying coverage.

The estimated scores of millions of eventual health-plan cancellations that Americans will soon face are not some weird unintended consequence of ObamaCare. They are fundamental to making the law work as written. The Affordable Care Act relies on previously uninsured young people to overpay for coverage they don't need, and for previously insured adults to pay for health contingencies they will never face, be it childbirth for men or pediatric dental care for grandparents. That is what is supposed to allow more people to be covered and to keep overall rates in check. Since making people's health insurance more expensive is not particularly popular, Obama lied about it, and not only when he claimed you could keep your plan and your doctor.

But the palace guard media, including Lester Holt, help keep the bubble inflated.

For years, liberal commentators have accused conservatives of living in an intellectual "bubble" of their own creation, impervious to reality. But through official intent and intellectual laziness, Democrats have created a bubble of deception surrounding ObamaCare that will affect millions of Americans for years to come. A lie this ignoble should stain the credibility of everyone who perpetuated it.

And people shake their heads over Donald Trump asserting, "We're being governed by stupid people." Yes, with a palace guard media complicit in hiding the stupid.